Equinor, Orsted Engaging With US Over Offshore Wind Suspension
(Bloomberg) -- Equinor ASA and Orsted A/S said they are engaging with US authorities over security concerns tied to their offshore wind projects, after the Trump administration issued another round of work suspension orders.
The US announced on Monday it would suspend leases for all five wind farms under construction off the East Coast, citing national security concerns that the turbines may interfere with radar systems. The five projects represent about $28 billion in total committed capital, according to BloombergNEF.
The projects impacted include Orsted’s Revolution Wind and Sunrise Wind which will both be ready to deliver power in 2026, with Revolution Wind expected to begin generating in January, the company said in a statement. Equinor said its Empire Wind 1 project is 60% complete.
Danish wind developer Orsted said it is “evaluating all options,” including “potential legal proceedings,” in a statement late yesterday. Equinor said that it is fulfilling the “relevant national security-related requirements” set out over several years.
Both developers said they are complying with stop-work orders issued by the Bureau of Ocean Energy Management.
President Trump has openly expressed disdain for wind power and imposed restrictions on offshore projects within hours of taking office in January, leading to various legal challenges. A federal judge ruled earlier this month that the president’s ban on new projects was illegal. Some analysts have questioned how robust the basis is for the government’s latest challenge.
“We expect legal challenge from the developers,” Deepa Venkateswaran, analyst at Bernstein, wrote in a note. Because the order is related to a classified report and affects national security, it is “unclear if the courts will be able to provide injunctive relief,” she said, adding that the the cost of a delay could be as much as $70 million a gigawatt per week for Orsted’s projects.
Equinor’s Empire Wind project, located off New Jersey, will power 500,000 homes. As of September 30, the project had a gross book value of around $3.1 billion, including South Brooklyn Marine Terminal.
“The stop work order threatens the progress of these activities and without a swift solution there may be significant impact to the project,” Equinor said.
Orsted shares were little changed on Tuesday, after falling almost 13% on Monday.
Other projects affected by the stop work order are Vineyard Wind 1 off Massachusetts and Coastal Virginia.
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